Government urges UK plc to tap £100m green loan fund

Energy and climate change secretary Ed Miliband will today call on UK business leaders to take advantage of the additional £100m in green interest-free loans announced in last week's Budget.

The new funding will be made available over the next two years through the Carbon Trust's existing energy-efficient loan scheme and Miliband urged businesses to contact the government-backed company immediately to find out if they are eligible for the scheme.

"Interest-free loans totalling £100m over the next two years were announced in the Budget," he said. "This real help, delivered by the Carbon Trust in England, means that businesses in every corner of Britain can now improve their energy efficiency and make real savings on their energy bills at a time when every penny counts."

Under the loan scheme, small and medium-sized firms investing in energy-efficient technologies, such as new boilers or air conditioning systems, can receive unsecured loans to cover the cost of the project, which they pay back, interest free, over a period of up to four years.

Any firm with fewer than 250 staff or a turnover of less than £40m is eligible for the scheme, and according to the Carbon Trust many companies find that resulting energy savings of about 20 per cent more than cover the cost of loan repayments.

It added that the new £100m funding, which will enable a three-fold extension of the existing scheme, will help save businesses £20m in annual energy bills while delivering cuts in carbon emissions of 140,000 tonnes a year.

Miliband's call for greater participation in the scheme comes as the Carbon Trust today publishes a new Carbon Map, showing that UK firms could save more than £2.5bn a year through simple and cost-effective energy-efficiency investments, such as upgrading lighting, heating and cooling systems.

The map is based on data from green consultancies Building Research Establishment Ltd and AEA, and reveals that there are considerable regional variations in the potential for corporate energy savings.

It shows that Greater London, the South East and North West have the greatest potential for savings, with each area able to deliver cuts in energy use worth more than £270m a year. In contrast, savings in the North East, Wales and the South West are less pronounced, although each region still has the potential to realise savings of more than £120m.